Flunking Economics
By Eugene Robinson
Washington Post
Friday, September 19, 2008
John McCain was telling the truth when he said that economics wasn't his strong suit. In response to what many economists have called the worst financial crisis since the Great Depression, the Republican nominee has sounded -- and let's be honest here -- totally, embarrassingly and dangerously clueless.
His now-famous remark Monday about how "the fundamentals of our economy are strong" would almost by itself be enough to justify my assessment. But he committed what was probably an even worse gaffe on Tuesday when, as the behemoth insurance company AIG teetered on the brink, McCain took a stand. "I do not believe that the American taxpayer should be on the hook for AIG," he said. "We cannot have the taxpayers bail out AIG or anybody else."
Within hours, the federal government had bailed out AIG to the tune of $85 billion. Treasury Secretary Henry Paulson and others who know how Wall Street works understood that if AIG were to collapse, much of the financial system might follow.
McCain quickly changed his tune, saying the government was "forced" to rescue AIG because of "failed regulation, reckless management and a casino culture on Wall Street." That sounds okay, but wait a minute. If he had any idea what he was talking about -- if he had any inkling of how big AIG is, or how central the company has become -- then why on earth would he have taken a stand against a bailout in the first place? Doesn't he have economic advisers who could fill him in?
Oh, I forgot. McCain's top economic guru, Douglas Holtz-Eakin, was busy explaining to reporters that McCain, as chairman of the Senate Commerce Committee, "helped create" the BlackBerry. The McCain campaign quickly dismissed Holtz-Eakin's remark as a "boneheaded joke," but it was delivered with an awfully convincing deadpan. The blogosphere lit up with comparisons to Al Gore's alleged claim to have invented the Internet.
(Continued here.)
Washington Post
Friday, September 19, 2008
John McCain was telling the truth when he said that economics wasn't his strong suit. In response to what many economists have called the worst financial crisis since the Great Depression, the Republican nominee has sounded -- and let's be honest here -- totally, embarrassingly and dangerously clueless.
His now-famous remark Monday about how "the fundamentals of our economy are strong" would almost by itself be enough to justify my assessment. But he committed what was probably an even worse gaffe on Tuesday when, as the behemoth insurance company AIG teetered on the brink, McCain took a stand. "I do not believe that the American taxpayer should be on the hook for AIG," he said. "We cannot have the taxpayers bail out AIG or anybody else."
Within hours, the federal government had bailed out AIG to the tune of $85 billion. Treasury Secretary Henry Paulson and others who know how Wall Street works understood that if AIG were to collapse, much of the financial system might follow.
McCain quickly changed his tune, saying the government was "forced" to rescue AIG because of "failed regulation, reckless management and a casino culture on Wall Street." That sounds okay, but wait a minute. If he had any idea what he was talking about -- if he had any inkling of how big AIG is, or how central the company has become -- then why on earth would he have taken a stand against a bailout in the first place? Doesn't he have economic advisers who could fill him in?
Oh, I forgot. McCain's top economic guru, Douglas Holtz-Eakin, was busy explaining to reporters that McCain, as chairman of the Senate Commerce Committee, "helped create" the BlackBerry. The McCain campaign quickly dismissed Holtz-Eakin's remark as a "boneheaded joke," but it was delivered with an awfully convincing deadpan. The blogosphere lit up with comparisons to Al Gore's alleged claim to have invented the Internet.
(Continued here.)
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